As has been expected, finance minister Nirmala Sitharaman has unveiled a slew of measures to boost rural entrepreneurship and demand. The country's economic gloom was widely attributed to a fall in rural consumption.
The country's rural sector was given a dimension of aspiration, normally associated with urban growth. She began by reiterating the earlier promise of doubling farmers income by 2022. She then listed 16 comprehensive measures to boost rural demand, growth and entrepreneurship.
Change in farming practices
These include a reorientation of rural farming practices including a shift from chemical fertilisers, removal of farm market distortions, thrust on new sectors, special schemes for water-stressed districts and also considerable assistance for a shift to solar energy in rural areas.
Solar energy
The shift to solar energy is ambitious that it is envisaged also as a income-generating project. The plan is to assist 20 lakh farmers to install stand-alone solar pumps. For another 15 lakh farmers with fallow or barren land, they will be allowed to set up solar generation units and link it to the mainstream power grid. The farmrers can then sell their power to the grid and earn money.
Village storage project
There is also an attempt to bring women to the centre-stage of rural economy. A village storage project run by women has been announced. The finance minister said the project can be taken up by women self-help groups. “Women SHGs can avail of Mudra loans or NABARD assistance,” the minister said. She said this would be a throwback to the time when women were the guardians of a village's seed repository. The project is also expected to bring down the logistics cost of farmers.
Boosting rural demand
These steps are expected to boost rural demand that has seen a record low in the last two years. Already figures have come out of falling rural demand. If the average monthly consumption levels of the poorest 50 per cent of the rural population was Rs 1138 in 2011-12, it had fallen to Rs 1082 in 2017-18.
Overall, the average monthly household consumption reduced from Rs 1430 in 2011-12 to Rs 1304 in 2017-18, a sharp decline of around 9 per cent. In short, people in rural areas have found their purchasing power declining in the last five years.
